Correlation Between SECURITAS and Anheuser Busch

Can any of the company-specific risk be diversified away by investing in both SECURITAS and Anheuser Busch at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining SECURITAS and Anheuser Busch into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between SECURITAS B and Anheuser Busch InBev SANV, you can compare the effects of market volatilities on SECURITAS and Anheuser Busch and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in SECURITAS with a short position of Anheuser Busch. Check out your portfolio center. Please also check ongoing floating volatility patterns of SECURITAS and Anheuser Busch.

Diversification Opportunities for SECURITAS and Anheuser Busch

0.06

Correlation Coefficient

SECURITAS  Anheuser Busch

Significant diversification

The 3 months correlation between SECURITAS and Anheuser is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding SECURITAS B and Anheuser Busch InBev SANV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anheuser Busch InBev and SECURITAS is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on SECURITAS B are associated (or correlated) with Anheuser Busch. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anheuser Busch InBev has no effect on the direction of SECURITAS i.e., SECURITAS and Anheuser Busch go up and down completely randomly.

Pair Corralation between SECURITAS and Anheuser Busch

Assuming the 90 days trading horizon SECURITAS B is expected to generate 2.68 times more return on investment than Anheuser Busch. However, SECURITAS is 2.68 times more volatile than Anheuser Busch InBev SANV. It trades about 0.02 of its potential returns per unit of risk. Anheuser Busch InBev SANV is currently generating about 0.04 per unit of risk. If you would invest  1,281  in SECURITAS B on April 20, 2025 and sell it today you would earn a total of  13.00  from holding SECURITAS B or generate 1.01% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

SECURITAS B   vs.  Anheuser Busch InBev SANV

SECURITAS B

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SECURITAS B are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, SECURITAS is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Anheuser Busch InBev

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Anheuser Busch InBev SANV are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Anheuser Busch is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with SECURITAS and Anheuser Busch

The main advantage of trading using opposite SECURITAS and Anheuser Busch positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SECURITAS position performs unexpectedly, Anheuser Busch can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Anheuser Busch will offset losses from the drop in Anheuser Busch's long position.

The idea behind SECURITAS B and Anheuser Busch InBev SANV pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.